m reforms aimed at improving competitiveness and long-term
growth. Italy has moved slowly, however, on implementing needed
structural reforms, such as lightening the high tax burden and
overhauling Italy's rigid labor market and over-generous pension
system, because of the current economic slowdown and opposition from
labor unions. But the leadership faces a severe economic constraint:
the budget has breached the 3% EU deficit ceiling.

Jamaica
The Jamaican economy is heavily dependent on services, which
now account for 60% of GDP. The country continues to derive most of
its foreign exchange from tourism, remittances, and bauxite/alumina.
The global economic slowdown, particularly after the terrorist
attacks in the US on 11 September 2001, stunted economic growth; the
economy rebounded moderately in 2003-04, with brisk tourist seasons.
But the economy faces serious long-term problems: high interest
rates; increased foreign competition; a pressured, sometimes
sliding, exchange rate; a sizable merchandise trade deficit;
large-scale unemployment; and a growing internal debt, the result of
government bailouts to ailing sectors of the economy. The ratio of
debt to GDP is close to 150%. Inflation, previously a bright spot,
is expected to remain in the double digits. Uncertain economic
conditions have led to increased civil unrest, including gang
violence fueled by the drug trade. In 2004, the government faced the
difficult prospect of having to achieve fiscal discipline in order
to maintain debt payments while simultaneously attacking a serious
and growing crime problem which is hampering economic growth.
Attempts at deficit control were derailed by Hurricane Ivan in
September 2004, which required substantial government spending to
repair the damage. Despite the hurricane, tourism looks set to enjoy
solid growth for the foreseeable future.

Jan Mayen
Jan Mayen is a volcanic island with no exploitable natural
resources. Economic activity is limited to providing services for
employees of Norway's radio and meteorological stations on the
island.

Japan
Government-industry cooperation, a strong work ethic, mastery
of high technology, and a comparatively small defense allocation (1%
of GDP) helped Japan advance with extraordinary rapidity to the rank
of second most technologically-powerful economy in the world after
the US and third-largest economy aft